I’m going to preface this post with a bit of an explanation, because I suspect some backlash may be a possibility. First of all, management is a full-time job. There is far more to running a salon than doing payroll and placing product orders. If you are running your business like a business, you will live by reports and systems for every aspect of your salon. Your work life will be scheduled to the last detail to maximize your efficiency.
I had systems for inventory management, client distribution, employee evaluation, quality assurance, and performance-based compensation. I also organized continuing education, salon contests and competitions, meeting agendas, and portfolio-building opportunities. On top of those tasks, I set sales and retail goals, monitored our marketing efforts, handled social media and website changes, created seasonal services and corresponding promotions, and regularly assessed and adjusted our budget to accommodate fluctuations in performance.
Managers who have worked for corporate chains know exactly what I’m talking about when I say, “Management is a full-time job,” since corporations hire dedicated mangers who run these systems and perform these tasks on a daily basis. Independent salon owners often look at me with a perplexed expression or scoff at me, generally because they have no experience working in actual business management.
I’m not saying that you absolutely can’t have a moderately successful business if you aren’t dedicating yourself to management, but I am saying that without dedicated management your salon will not meet its full potential. Contrary to popular belief (among the uneducated and inexperienced), salons do not “run themselves” and you cannot effectively run your business if you’re working behind a chair full-time unless you have hired someone to manage it for you.
November’s theme is management. I’m not going to talk about managing social media, “turning goals into reality,” or any of that other played out, click-bait garbage. If you want to read a bunch of recycled “Holiday Retail Strategies,” visit any other beauty business blog or e-zine this month. They’re all covering that right now. Tis the season.
This article has been written to get you thinking like an actual business owner.
Too many salon owners struggle because they were not properly educated in business operations or management. Some owners have done well designing their own management techniques and learning as they go, but many haven’t.
A lot of people stepped into the role of salon owner/manager for the wrong reasons. For the most part, they wanted to create a great working environment and a superior client experience. While that’s admirable, a good deal of these entrepreneurs had no idea what a salon owner or manager’s job description entailed. If you’re a current salon owner/manager or you’re reading this because you’re considering ownership or management one day, we’re going to do an exercise right now. Grab a pen and paper.
Answer these questions without cheating. No Googling.
I’ve designed these questions to determine how prepared and educated potential salon owners are. I also use them to discover where my consulting clients are in terms of their own knowledge of business ownership. (If you won’t answer these questions without cheating, don’t even bother filling them out. You aren’t ready for ownership.)
- Write down a salon owner’s job description.
- Detail the daily life of a salon owner, starting from the time they open their eyes in the morning to the time they shut them at night.
- Without looking it up, what is your state’s income tax rate and the current federal employment tax rate?
- What does the wage legislation in your area say about payment dates? Which deductions are lawful, if any? Are you required to provide detailed pay stubs, and if so, what information must be provided? When an employee leaves, when must they be given their last paycheck?
- What is your jurisdiction’s minimum wage?
- What are the state and federal recordkeeping, posting, and filing requirements?
- What is the difference between an employee and an independent contractor?
- What is the difference between an independent contractor and a self-employed person?
- What is the difference between “right-to-work” and “at-will employment?”
- What insurance policies are salon owners required to carry?
- What are the ventilation and square footage requirements for salons in your city/state?
- What are your state board regulations regarding sanitation and other facility requirements?
- What does FLSA stand for and what does it mean for you as an employer?
- What insurance policies are you required to carry as a salon owner?
- Do contracts protect you against every foreseeable circumstance, even if they’re improperly written?
- Who takes on the fine if one of your employees is determined to be in violation of your state’s cosmetology regulations?
Believe it or not, I have consulting clients who are current business owners (or have already signed leases on commercial spaces) but have given absolutely no consideration to any of the above questions. They don’t know any of the answers, yet they think it’s possible to just open up shop and start collecting money.
I often see people post questions on Facebook networking groups.
“I want to open a salon. What do I have to do?”
“I’m thinking about buying an existing salon. Does anyone know what’s involved with salon ownership?”
“I’ve signed a lease and construction is almost done but I’m not sure what to do now? How do I set the prices?”
My inbox is frequently hit with these general inquiries also.
These questions cannot be answered in an email response or comment box.
I couldn’t condense salon ownership or management into less than 500 pages if I tried (and believe me, I tried hard and my book on salon ownership and management came out to nearly 650). It does not matter if you have been working in this industry for 35 years—if you don’t know how to manage a business you are not ready to even consider salon ownership.
Do you need to go to college and get an MBA? Hell no. (I didn’t.) But you do need to make a significant effort to educate yourself.
- Utilize resources like SCORE. Most states also have tons of free resources for small business owners.
- Read books.
- Attend business workshops.
- Consult with IRS, DOL, and state employees.
- Set money aside to retain an employment attorney to help guide you through your setup process.
- Hire a knowledgeable, reputable consultant with industry experience who actually UNDERSTANDS the laws and can provide you with legitimate state and federal resources to back up their advice.
Owners, these things are your responsibility. Ignorance of the law will not protect you.
The Salon Compensation and Pricing Megakit calculates salon compensation and service pricing for you! It includes:
- The Salon Compensation and Pricing Calculator, an 8-page spreadsheet system that makes salon compensation and pricing calculation as simple as data entry. The best part? The system is enabled with protections to make it impossible to “break” the formulas!
- The Salon Compensation and Pricing Guide, a 44-page instruction manual that not only explains how to use the system but also explains every formula so you’re never confused about what the numbers mean or where they came from.
- A 9-page Employer Obligations Information Sheet to keep you from making very common life-destroying mistakes.
- Be Worth What You Charge, an 11-page checklist and salon evaluation resource.